Category : Press Release
Date : July 01, 2019
Title : 2019 Pre-SONA Economic and Infrastructure Forum - Press Release
Article : Investor Relations Office
Press Release
1 July 2019

Pre-SONA Forum:

Top economic, infra officials highlight reform-led pursuit of sustainable, more inclusive economic growth

Top economic and infrastructure officials of government highlighted before the investor community and other stakeholders the critical reforms—both those implemented and in the pipeline—that are meant to push the Philippines toward the next stage of economic development.

During the “Pre-State of the Nation Adress (SONA) Economic and Infrastructure Forum” held Monday at the Philippine International Convention Center, the officials provided major updates on the economy, including reforms in the policy and infrastructure arenas that will further unleash the Philippines’ economic growth potential.

The event, which carried the theme “Game-Changing Reforms for Sustainable Development,” reported on the status of the economy and on government efforts to pursue the “Patuloy na Pag-unlad” (sustained development) agenda.

In his opening remarks, Executive Secretary Salvador Medialdea said the theme was chosen as it best captures the actions on a broad range of concerns that the Duterte administration has accomplished.

Finance Secretary Carlos Dominguez III, who heads the administration’s economic cluster, pointed out in a speech the decisive leadership of President Duterte that is instrumental in implementing reforms, even the unpopular ones, that have improved the structural framework of the economy and, as such, will help push it to the next phase of development.

Reforms already implemented include vital legislation, including on tax reform, national ID system, liberalization of rice imports, ease of doing business, and amendments to the charter of the Bangko Sentral ng Pilipinas; as well as efforts to further open up the economy to foreign investments, particularly through the relaxation of the foreign investments negative list.

Policy reforms in the pipeline include additional tax reform packages that will help boost government revenues and make the country more attractive to investments.

With the reforms, the Philippines—which is expected to graduate from “middle income” to “upper middle income” economy this year or next year—is seen to realize the long-term goal of becoming a high-income economy by 2040.

Dominguez said: “Over the past three years, the Duterte administration has shown great political resolve. Reforms across a broad spectrum were initiated. Robust economic growth continues to gain momentum. Massive investments in our economy’s competitiveness continue to be made. Ambitious programs have been instituted. Our fiscal position is as strong as it has ever been.”

The Finance Secretary added: “While we rank among the best performing economies in this dynamic part of the world, growth is not our final goal. Our ultimate goal is to bring down poverty rates and create more opportunities for all law-abiding Filipinos.”

Bangko Sentral ng Pilipinas Deputy Governor Diwa Guinigundo highlighted developments in the monetary, external, and financial sectors. He cited the favorable inflation outlook this year and next year, which is brought about in part by the conduct of sound monetary policy. Non-monetary measures have also helped bring about a favorable inflation environment, including measures to ease imports of rice and other agricultural products, thereby boosting supply.

Inflation, after being elevated last year due to spike in global oil prices and other supply pressures, is seen to settle within the 2.0 to 4.0 percent target range this year and next year.

On the external front, Guinigundo cited robust foreign exchange inflows, such as foreign direct investments, business process outsourcing revenues, remittances, and tourism receipts, which provide strong buffer against shocks. The inflows help cover for the current account deficit, which is driven by rising importation of capital goods amid rising investments.

“There is a positive story about the Philippines’ external payment position in that it has remained manageable despite the deficit in the current account,” Guinigundo said.

He said the BSP maintains sound policies on external account management, including liberalization of foreign exchange regulations that have helped provide an enabling environment for foreign direct investments. The BSP has implemented 11 waves of foreign exchange rules liberalization since 2007, he said.

On the banking sector, which is aided by sound regulations, Guinigundo said it remains strong and able to finance the funding needs of the growing economy.

Public Works and Highways Secretary Mark Villar reported on the major accomplishments in relation to the government’s infrastructure development agenda dubbed “Build, Build, Build.”

The infrastructure projects are considered “game changing” in that they are expected to significantly help decongest cities and better interconnect the Philippines’ islands through massive airports, railways, seaports, and inter-island connector roads.

Villar also cited infrastructure projects meant to spur the development of specific sectors. These include the “Tourism and Infrastructure Program,” which boosts access to tourism destinations; and the “Agriculture Infrastructure Support Program,”which builds infrastructure meant to boost productivity and connectivity of agriculture areas.

Villar likewise trumpeted the “High Standard Highway Network Program”, under which several expressways are either being constructed or will be constructed to significantly reduce travel time from one point to another.

“The government has been working really hard to attain the ‘Golden Age of Infrastructure’ through the impeccable
‘Build, Build, Build’ program,” Villar said.

Lastly, Bases Conversion and Development Authority (BCDA) President and CEO Vivencio Dizon reported on the progress of the “New Clark City,” which will be the country’s first smart and green city. Located in Capas, Tarlac and measuring about 9,500 hectares, New Clark City will be a major alternative growth area outside Metro Manila.

Dizon said: New Clark City will serve as a “catalyst for national growth” moving forward, with private sector partners investing in the development of commercial areas and industrial parks there.

Other officials from the economic cluster who graced the event through their participation in a panel discussion were Trade and Industry Secretary Ramon Lopez, Socioeconomic Planning Secretary Ernesto Pernia, Science and Technology Secretary Fortunato De La Pena, Energy Secretary Alfonso Cusi, Tourism Undersecretary Art Boncato, and Budget OIC Secretary Janet Abuel.

Other officials from the infrastructure cluster who engaged the audience in a separate panel discussion were Transportation Secretary Arthur Tugade and Information and Communications Acting Secretary Eliseo Rio Jr.

The event was one of the three fora meant to report on the government’s accomplishments under the Duterte Administration, ahead of the President’s SONA on 22 July 2019.

The second forum, to be held on 10 July 2019 in Cebu City, will report on accomplishments related to the “patuloy na malasakit at pagkakaisa” agenda (which is focused on human development).

The third forum, to be held on 17 July 2019 in Davao City, will report on accomplishments related to the “Patuloy na Katatagan” agenda (which is focused on security and disaster resiliency).